Jump in tax on fuel

The tax on petrol, which is collected to help pay for the country’s land-transport system, has gone up by three cents per litre, the third of three scheduled annual tax increases. However, at the same time ACC is reducing the tax it collects from petrol by three cents. “The tax changes cancel each other out meaning they shouldn’t change prices at the pump,” says Mark Stockdale, the AA’s PetrolWatch spokesman. “However, recent small reductions in commodity prices mean the AA thinks petrol prices should fall slightly.” The tax changes mean the total amount of petrol tax collected specifically for the National Land Transport Fund will rise to 59.524 cents per litre, while ACC levies will fall to 6.9 cents per litre. “Allowing for other miscellaneous taxes and GST, the total amount of tax paid on the current retail price of $2.12 per litre for 91 octane petrol equals nearly 96 cents per litre,” adds Stockdale. By comparison, the tax on diesel, which mostly comprises GST, totals 17.47 cents per litre.

Road-user charges also increasing

Road-user charges (RUC) paid by diesel vehicles also went up on July 1 – by $4 per 1,000km – an increase nearly double what it should be, says Stockdale. “To match the three cents increase in petrol tax to the National Land Transport Fund, which other motorists are paying, RUC should have only increased $2.50 per 1,000km, or $30 over 12,000km.” Over the past three years, the amount of petrol tax collected for the National Land Transport Fund has risen by nine cents per litre, while RUC have gone up by $14 per 1000km. “For a typical two-litre car travelling 12,000km a year, the extra petrol tax paid into the fund equals $81 a year whereas owners of diesel cars travelling the same mileage are paying an extra $168 a year.”